Yahoo! Inc.’s profit fell 61 percent to $268.7 million partly because stock-option expenses trimmed fourth-quarter earnings.

Revenue rose 13 percent to $1.702 billion. A year ago, the company had posted a one-time gain from the sale of its China business to Alibaba.com.

According to Nielsen//NetRatings, Yahoo grew Web traffic 6 percent year over year to a monthly average audience of 110.1 million unique visitors in the fourth quarter of 2006.

Yahoo’s fastest growing Web efforts include its video channel, which tripled its audience to nearly 6 million on a monthly basis, up from 2 million per month in the fourth quarter of 2005.

Sponsorship around video content presents a significant learning and growth opportunity, Yahoo Chairman Terry Semel said during the 4th quarter earnings conference call with analysts.

(Editor: Gilbert)